Zurich Insurance Group AG (ZURN.EB) said its profit fell in the first quarter compared with a year earlier due to a change in how claims are calculated in the U.K., but added that an improved economic outlook could help the company's prospects for the rest of the year.
The Swiss insurer said net income fell to $607 million in the first quarter from $875 million a year earlier.
Business operating profit was $928 million last quarter, down 13% on the year. However, this was affected by a change in the way the U.K. calculates personal injury and accident claims. The change, known as the Ogden rate, resulted in a hit to first-quarter operating profit of $289 million.
Excluding that effect, business operating profit was $1.2 billion, up 14% from one year earlier.
"Underwriting performance is improving and we have delivered another absolute reduction in expenses," said Chief Financial Officer George Quinn.
Analysts at Vontobel said the first-quarter results signal "a solid start to the year" after the one-off effect of the Ogden rate. Zurich shares were down 0.8% at 0826 GMT.
"The stronger economic environment is also delivering a better than expected investment performance and, given the cautious position that we took last year, could positively influence the rest of this year," Mr. Quinn added.
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(END) Dow Jones Newswires
May 11, 2017 04:57 ET (08:57 GMT)